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Federal Aid for States to Invest in Health IT

Also today, CMS issued this final regulation that will help states develop and upgrade their Medicaid internet technology (IT) enrollment systems.

The new rule implements Section 1903(a)(3)(A)(i) of the ACA which increases Medicaid’s federal match — to 90 percent! — of the cost for states to develop systems to help people enroll in Medicaid or the Children’s Health Insurance Program (CHIP). States can use the money to design, develop, or install mechanized claims processing and information retrieval systems as the “Secretary [of HHS] determines are likely to provide more efficient, economical and effective administration of the plan and to be compatible with the claims processing and information retrieval systems utilized in the administration of title XVIII [Medicare].”

The rule also increases to 75-percent federal match for ongoing operational costs and establishes performance standards for improved eligibility systems to promote greater efficiency and a more consumer-friendly enrollment process.

The previous federal match had been the traditional Medicaid rate of 50 percent. By shouldering considerably more of costs related to enrollment technology, the federal government hopes that states will be better able to prepare for the improvements and the Medicaid/Exchange expansions that will come in 2014.

Because California did not apply for an “Early Innovator” grant, implementation of this new rule offers our state the opportunity to invest in a new, IT-based enrollment systems that will hopefully make it easy, come 2014, for anyone to understand their health coverage options, enroll in Medi-Cal or the Exchange, renew their coverage, and stay covered while transitioning between coverage sources.